Don’t be victimized by student loan scams. Students need to be fully informed about the various borrowing options, their interest rates and repayment terms. Scammers, along with legitimate companies sense the fear among borrowers and try to work it to their benefit. When you come across a program that promises to reduce your student debt, keep in mind that not all student loan relief is in your best interest. With the purpose of assisting you in identifying and avoiding scams, here are some of the most recent and common student loan scams to watch out for.
• Student Identity Theft Scam
This type of student loan scam is the most common one. The scammers try to hack your personal information, which can then be used by other people to get a student loan in your name. Before giving out your personal data, check the credentials of the company you are giving it to.
• Get Out of Debt Help
Be wary of being asked to pay for assistance in getting you out of debt. Debt relief programs are not all scams, but there is a trend of people using debt relief as a way to entice struggling student loan borrowers.
• Advanced Fee Scam
This involves a company offering to work to lower your student loan interest rate in exchange for a fee up front. Keep in mind that legitimate lenders will take a fee at the closing of the re-finance. If you are asked for a fee before any work is done on your behalf, avoid them.